Sanko Techno (3435) Q2 2025 earnings summary

Executive summary

• Revenue for the first half of FY2025 was ¥10,078 million, down 0.8% year-over-year, with operating profit at ¥742 million (down 22.8%) and net profit attributable to shareholders at ¥608 million (down 34.6%), impacted by project delays, lost orders, rising costs, and the absence of prior year’s one-time negative goodwill gains.

• Strategic investments in growth, including M&A, R&D, and execution of a new mid-term plan focused on human resource development and new business creation, are prioritized for future expansion despite short-term profit impact.

Financial highlights

• Revenue for 2Q FY2025: ¥10,078 million, down 0.8% year-over-year and 4.0% below plan.

• Operating profit: ¥742 million, down 22.8% year-over-year and 12.6% below plan; operating margin fell to 7.4%.

• Net income attributable to shareholders: ¥608 million, down 34.6% year-over-year but 4.9% above plan.

• Gross profit for the period was ¥3,019 million, with a gross margin of approximately 30%.

• EPS for the half-year was ¥76.95, compared to ¥117.69 in the previous year.

Outlook and guidance

• Full-year revenue forecast: ¥22,000 million, with operating profit of ¥1,850 million and net income of ¥1,300 million, all expected to decline year-over-year; no changes have been made to the previously announced earnings forecast.

• Growth investments and group synergies are expected to drive future expansion, with a focus on infrastructure demand and new product development.

• Risks from high material costs, yen depreciation, and labor shortages are incorporated into guidance.